Increasing your return on innovation

Innovation is back in the spotlight for many segments of the chemical industry. Just browse the Web sites of major chemical companies, where you will find innovation featured prominently on 70 percent of the sites. (1) Results from the Chemicals Summary of the 11th Annual Global CEO Survey by PricewaterhouseCoopers, released in January 2008, confirm this. The survey found that "nearly one-third (32 percent) of chemicals executives see new product development as a major opportunity to grow their business in the next 12 months, compared to fewer than one-fifth of executives across all industries."

With all the focus on innovation, what will it take for you to increase your return on innovation?

Innovation may be the engine of growth and profitability, but nurturing innovation is no easy matter. Innovation requires a culture that nourishes creative ideas, a process that enables raw ideas to grow to full-fledged products or processes, strong collaboration that is increasingly global, and the vigorous protection of intellectual property.

However, Microsoft's own studies show that most companies, including those in the chemical industry, lag in developing processes that support innovation. For example:

Efforts to develop well-defined processes are further complicated by some major trends in the chemical industry:

The Microsoft innovation solution

To bridge the gap between the intent to innovate and innovation itself, companies need to build a path to innovation, an infrastructure that includes a transparent process with an appropriate level of process control. For example, a December 2007 study by AMR Research reported that companies with a formal process to develop and launch new products "were faster to market. According to our spending data, time to market is the No. 1 factor behind application investment over the next 12 months." (2)

Employees need support for their ideas, while the system maintains data security and offers both a common language and easy ways for people to coordinate their efforts. Technology is a powerful tool for creating that pathway.

The Microsoft Innovation Process Management (IPM) solution offers just such a technology backbone to help the chemical industry facilitate and manage the innovation process. Microsoft's approach focuses on three key aspects of the process:

Ideation and knowledge capture. Once an idea has taken shape in a person's mind, it needs to be captured, socialized, analyzed, and protected. To test the idea initially and gain confidence in its utility, its originator must be able to find existing intellectual property, expertise, and resources within the enterprise. For example, the originator may want to post an idea on a wiki or blog so that others in the enterprise can rate it, help refine it, or give it momentum.

Collaboration and knowledge management. Idea people need to orchestrate resources across functional groups and geographies to reduce the time required to bring a concept to reality. Originators can seek assistance from fellow employees as well as customers, suppliers, and partner companies. Microsoft products support broad and convenient communication, with efficient messaging, transfer of ideas in concrete form, and ready exchange of materials.

The IPM solution makes sharing content easier while guarding proprietary and confidential information. It calls on technology that enhances cross-team communications with such real-time tools as instant messaging, Web conferences, and video chats that are so immediate your people feel they are there. At the same time, Windows Rights Management Services protects documents and e-mail to ensure that collaboration is highly secure. People can set permissions for classified documents and e-mail messages so that ideas are not revealed to the competition.

Project and portfolio management. When an idea has a high probability of becoming a successful innovation, the collaborative team must weigh it against business strategy, market conditions, globalization, customer loyalty, available resources, and many other factors, such as other emerging ideas. In addition, a critical part of idea development is to make the business case for a particular concept. Sophisticated portfolio management techniques can help decision makers view the full innovation pipeline and balance ideas against resources and risks.

Explore how Microsoft Innovation Process Management (IPM) can be the solution to increase your return on innovation:

Find out how chemical companies have innovated:

Sources

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